Is it possible to make money, but also lose your business? While it may seem like an oxymoron, it was almost a reality twice for Damian Lang, CEO of Malta Dynamics, EZG Manufacturing, Lang Masonry Contractors and Wolf Creek Construction.
Many contractors go out of business because they don’t understand their profit and loss statements, ultimately leading them to run out of cash – a harsh reality Damian learned firsthand.
In his latest contractor tip, Damian offers a personal example of how a contractor who sees his profits increasing can actually be losing money if he is not watching his spending and debt load compared to company profits.
A Few Key Points:
- Damian recommends conducting a monthly profit and loss statement review
- Understanding how to analyze these monthly statements is crucial to the success of any business
- Involve your staff in the process of analyzing profits and losses
Want to learn more about the importance of profit and loss statements when operating as a contractor? Check out Damian’s newest Contractor Tip.